Capillary Technologies Reports 16% Revenue Growth in Q3 FY26 Earnings Call
Capillary Technologies India Limited reported strong Q3 FY26 results with 16% revenue growth to INR 184 crores and 24% adjusted EBITDA growth to INR 30 crores. Nine-month revenue reached INR 543 crores (22% growth) with adjusted EBITDA of INR 71 crores (53% growth). The company maintained 111% net retention rate and added INR 66 crores in new order book, while strengthening its market leadership position in loyalty management platforms.
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Capillary Technologies India Limited conducted its Q3 FY26 earnings conference call on February 06, 2026, presenting strong financial results and strategic updates to analysts and investors. The company, a global leader in loyalty and customer engagement platforms, demonstrated continued growth momentum across key financial metrics.
Financial Performance Highlights
The company delivered robust financial results for both the quarter and nine-month periods ending December 31, 2025.
| Metric | Q3 FY26 | Q3 FY25 | Growth (%) |
|---|---|---|---|
| Revenue | INR 184 crores | INR 158 crores | 16% |
| Adjusted EBITDA | INR 30 crores | INR 24 crores | 24% |
| EBITDA Margin | 16.4% | 15.3% | +110 bps |
| PAT | INR 8 crores | INR 11.4 crores | -30% |
For the nine-month period, revenue reached INR 543 crores, marking 22% year-on-year growth. Adjusted EBITDA for nine months stood at INR 71 crores, representing significant 53% growth compared to the previous year.
Key Business Metrics and Growth Drivers
Capillary Technologies maintained strong operational metrics that underpin its growth strategy. The company's net retention rate (NRR) for the trailing twelve months reached 111%, with organic business achieving an impressive 115% NRR. This places the company in the top 10 percentile of global SaaS companies.
| Business Metric | Performance |
|---|---|
| Net Retention Rate (TTM) | 111% |
| Organic Business NRR | 115% |
| Inorganic Business NRR | 96% |
| Annual Recurring Revenue Growth | 21% |
| New Order Book (9 months) | INR 66 crores |
The company added 12 new customers during the nine-month period, including three in the last quarter. Management outlined three key growth axes: net retention rate expansion from existing customers, new customer acquisitions, and strategic acquisitions of competitors.
Market Leadership and Product Innovation
Capillary Technologies reinforced its market-leading position through recognition in the latest Forrester Wave report for loyalty management platforms, released in December 2025. The company achieved the highest rating among 14-15 vendors, scoring 5 out of 5 on 22 of 27 evaluation criteria.
The company's AI-powered product, aiRA (AI-powered Research Assistant), continues gaining traction with customers. Management reported that 10-15 of their 115 customers are currently in proof-of-concept or post-POC phases with aiRA. The AI solution enables conversational analytics, campaign management, and customer support automation.
Profitability and Cash Generation
Despite strong EBITDA growth, PAT declined to INR 8 crores in Q3 FY26 from INR 11.4 crores in the previous year, primarily due to one-time expenses including INR 1.6 crores in gratuity costs and INR 2 crores in IPO-related expenses. Normalizing for these items, PAT remained flat year-on-year.
| Cash Flow Metrics | Nine Months FY26 |
|---|---|
| Operating Cash Flow | INR 101 crores |
| Cash Flow to EBITDA Ratio | 142% |
| Closing Cash Balance | INR 463 crores |
The company's depreciation and amortization increased to INR 19 crores from INR 13 crores, largely due to the Kognitiv acquisition completed in May 2025.
Strategic Outlook and Market Position
Management emphasized their competitive advantages in the loyalty management space, particularly against agency-based competitors. The company serves 410 brands across 115 customers, including 20 Fortune 500 companies, with operations spanning 47 countries. Their platform manages 1.8 billion consumer profiles with enterprise-grade uptime of five nines.
Looking ahead, Capillary Technologies continues focusing on expanding existing customer relationships, winning new enterprise clients, and integrating acquired platforms to drive margin expansion. The company's subscription-based model with long-term contracts provides revenue visibility and supports sustained growth.
Source: Capillary Technologies India Limited Q3 FY26 Earnings Conference Call Transcript
Historical Stock Returns for Capillary Technologies
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -2.67% | -7.94% | -10.81% | -7.31% | -7.31% | -7.31% |
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